The Plaintiff provided paving services for the Richmond Hills development starting in August 2005 and asserted that its date of last furnishing of materials was February 24, 2010. It filed a Claim of Lien on March 30, 2010, a month after the property was sold at foreclosure. The purchasers of the property contended that the Plaintiff had performed no services for a year prior to February 2010 and was therefore tardy in filing the Claim of Lien.
The Court of Appeal analysed the timing, looking to the following criteria to determine when the materials were last furnished for purposes of filing a materialmens lien:
(i) the work performed and materials furnished must be required by the contract;
(ii) .… Read More
John Conner Construction (“JCC”) and the other plaintiffs, provided labor and materials for the improvement of a parcel of land owned by Grandfather Holding Company (“GHC”), which had obtained financing for the purchase and improvement of the parcel from Mountain Community Bank (“MCB”). The construction was commenced prior to GHC actually purchasing the property. On completion of the construction, JCC presented a bill for $1,377,774.02, but GHC only had $262,000 remaining from the financing. This amount was paidl, leaving a substantial balance. Subsequently, GHC defaulted on the loan and the bank foreclosed, with MCB purchasing the property at the foreclosure sale for $4 million.… Read More
In two opinions, In re Harrelson Utilities, Inc. , No. 09-0281S-8-ATS (E.D.N.C. Bankr. July 3D, 2009) and In re Mammoth Grading, Inc., No. 0901286-8-ATS (E.D.N.C. Bankr. Aug. 24, 2009), bankruptcy court held that a subcontractor’s lien rights did not constitute “an interest in property” under the exception in 11 U.S.C. § 362(b) (3) and that post-petition claims of liens and notices of claims of liens were invalid and unenforceable. These decisions “turned the construction industry1s standard operating procedure on its head.”
Verging on an advisory opinion, the District Court questioned whether the bankruptcy court erred in determining that such liens did not arise until the filing of a notice of claim of lien by the subcontractor. … Read More